The Reserve Bank of India (RBI) has imposed a fine of Rs 29.6 lakh on Fino Payments Bank for not following certain rules related to the licensing of payments banks.

The RBI conducted a statutory inspection for supervisory evaluation (ISE 2024) of the bank’s operations as of 31 March 2024 and found that it had not complied with all the regulatory guidelines.

Based on the findings, the RBI issued a notice to Fino Payments Bank, asking them to explain why a penalty should not be imposed for these lapses.

After considering the bank's reply to the notice and oral submissions made during the personal hearing, the RBI was convinced that certain rules had been breached and warranted imposition of monetary penalty.

"The bank breached the regulatory ceiling of end of the day balance, as applicable for a payments bank, in certain accounts on several occasions," the RBI said in a release.

The RBI clarified that the penalty was only for deficiencies in regulatory compliance. It does not question the legality of any transaction or agreement the bank entered into with its customers.